Worries about US shale output wave as oil hits three-year high:
"Brent crude rose to a three-year high of $70 a barrel last week, but there are questions about the rally’s resilience as higher oil prices threaten to unleash a new wave of US shale output. “The higher the prices go, the harder shale producers pump,” Tamas Varga at London-based broker PVM, said. He added, an “overdue correction could be under way”. Oil prices have been rising since late June, supported by supply cuts led by Opec producers and allies outside of the cartel such as Russia, which helped to curb excess stockpiles. "
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Sunday, 14 January 2018
Saudi Arabia grants 3 Japanese companies licenses to operate in the kingdom - The National
Saudi Arabia grants 3 Japanese companies licenses to operate in the kingdom - The National:
"Saudi Arabia has granted licenses to three Japanese companies and signed six memorandums of understanding with other entities as the kingdoms seeks to open up its industries to foreign investors to diversify its revenue sources. The Saudi Arabian General Investment Authority (SAGIA) gave the licenses to three Japanese companies that include SMBC, a financial consultancy, SB Energy, a renewable energy consultancy and Tadano, a specialist that will provide technical services to Saudi agents in the industrial field, it said in a statement on Sunday. The six memorandums of understanding including agreements between the Saudi Stock Exchange or Tadawul and Nomura International; Alyemni Group and Japan’s Matsutan Chemical Industry; and Saudi Electricity Company, Tokyo Electric Power Company and Nissan."
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"Saudi Arabia has granted licenses to three Japanese companies and signed six memorandums of understanding with other entities as the kingdoms seeks to open up its industries to foreign investors to diversify its revenue sources. The Saudi Arabian General Investment Authority (SAGIA) gave the licenses to three Japanese companies that include SMBC, a financial consultancy, SB Energy, a renewable energy consultancy and Tadano, a specialist that will provide technical services to Saudi agents in the industrial field, it said in a statement on Sunday. The six memorandums of understanding including agreements between the Saudi Stock Exchange or Tadawul and Nomura International; Alyemni Group and Japan’s Matsutan Chemical Industry; and Saudi Electricity Company, Tokyo Electric Power Company and Nissan."
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Saudi government largesse sends economists back to the drawing board | Arab News
Saudi government largesse sends economists back to the drawing board | Arab News:
"THE armies of economists who produced reams of analysis of the Saudi Arabia budget for 2018 back in December need not have bothered. Within weeks, their calculations have been turned upside down by a series of measures from the government that radically reshaped the economic outlook for this year, with some positive consequences, but others not so welcome. The good news comes for two important constituencies: Saudi households and Saudi businesses. Both will benefit from the government’s largesse in offsetting big price rises via value added tax and the reduction of subsidies on fuel and power, even though they will have to deal with the prospect of higher inflation."
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"THE armies of economists who produced reams of analysis of the Saudi Arabia budget for 2018 back in December need not have bothered. Within weeks, their calculations have been turned upside down by a series of measures from the government that radically reshaped the economic outlook for this year, with some positive consequences, but others not so welcome. The good news comes for two important constituencies: Saudi households and Saudi businesses. Both will benefit from the government’s largesse in offsetting big price rises via value added tax and the reduction of subsidies on fuel and power, even though they will have to deal with the prospect of higher inflation."
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Qatar will continue to support oil output cut - The Peninsula Qatar
Qatar will continue to support oil output cut - The Peninsula Qatar:
"Minister of Energy and Industry H E Dr Mohammed bin Saleh Al Sada has emphasised that Qatar supports the continuation of work on the “declaration of cooperation” between members of the Organization of Petroleum Exporting Countries (Opec) and producers outside of the Organization on reducing their oil production.
On the developments in the global oil market since the Vienna agreement and the trend of oil prices to rise, Dr Al Sada said that “the agreement proved to be in the right direction”. The balance of supply and demand, in addition to the level of the world’s stock, together constitute the main factors that Opec and the countries participating in the agreement to decide based on the continuation of work with it, he said in an exclusive interview to QNA.
If the level of oil reserves returned to balance, or to the average of the last five years, whether this is achieved by the next Opec meeting in June, or at the time determined by market developments, then only a safe agreement should be initiated commensurate with market conditions then. “So we think it is premature to put forward an idea of a strategy to terminate the agreement at the current stage.”
"
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"Minister of Energy and Industry H E Dr Mohammed bin Saleh Al Sada has emphasised that Qatar supports the continuation of work on the “declaration of cooperation” between members of the Organization of Petroleum Exporting Countries (Opec) and producers outside of the Organization on reducing their oil production.
On the developments in the global oil market since the Vienna agreement and the trend of oil prices to rise, Dr Al Sada said that “the agreement proved to be in the right direction”. The balance of supply and demand, in addition to the level of the world’s stock, together constitute the main factors that Opec and the countries participating in the agreement to decide based on the continuation of work with it, he said in an exclusive interview to QNA.
If the level of oil reserves returned to balance, or to the average of the last five years, whether this is achieved by the next Opec meeting in June, or at the time determined by market developments, then only a safe agreement should be initiated commensurate with market conditions then. “So we think it is premature to put forward an idea of a strategy to terminate the agreement at the current stage.”
"
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Saudi Handouts' Cost May Exceed Government Estimates, BofA Says - Bloomberg
Saudi Handouts' Cost May Exceed Government Estimates, BofA Says - Bloomberg:
"Saudi authorities may have underestimated the financial cost of royal handouts dolled out to citizens complaining about rising prices, according to Bank of America Merrill Lynch.
The government will spend 61.8 billion riyals ($16.48 billion) on a package that included paying civil servants a monthly 1,000-riyal allowance for a year and restoring annual pay raises suspended in 2017, London-based economist Jean-Michel Saliba wrote in a report. Officials said the package would cost about 50 billion riyals.
King Salman issued the royal order this month after public complaints about the impact of higher fuel prices and the introduction of a 5 percent value-added tax. The measures will likely make the government more reliant on higher oil prices to boost revenue, chipping at the credibility of Crown Prince Mohammed bin Salman’s plan to end the economy’s addiction to hydrocarbons."
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"Saudi authorities may have underestimated the financial cost of royal handouts dolled out to citizens complaining about rising prices, according to Bank of America Merrill Lynch.
The government will spend 61.8 billion riyals ($16.48 billion) on a package that included paying civil servants a monthly 1,000-riyal allowance for a year and restoring annual pay raises suspended in 2017, London-based economist Jean-Michel Saliba wrote in a report. Officials said the package would cost about 50 billion riyals.
King Salman issued the royal order this month after public complaints about the impact of higher fuel prices and the introduction of a 5 percent value-added tax. The measures will likely make the government more reliant on higher oil prices to boost revenue, chipping at the credibility of Crown Prince Mohammed bin Salman’s plan to end the economy’s addiction to hydrocarbons."
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MIDEAST STOCKS-Progress towards settling corruption cases boosts Saudi
MIDEAST STOCKS-Progress towards settling corruption cases boosts Saudi:
"Signs of progress towards settling cases in Saudi Arabia’s crackdown on corruption boosted its stock market on Sunday, while Qatar’s bourse rose for a seventh straight day as investors bought ahead of annual dividend announcements.
The Saudi index far outperformed the rest of the region as it rose 1.4 percent to 7,440 points in active trade, rising above last September’s peak of 7,429 points.
Dozens of Saudi princes, officials and top businessmen - including owners of major stakes in some firms - were detained as part of the crackdown in early November. The market’s initial panic has faded, but investors are still concerned about the fate of some of the companies involved.
"
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"Signs of progress towards settling cases in Saudi Arabia’s crackdown on corruption boosted its stock market on Sunday, while Qatar’s bourse rose for a seventh straight day as investors bought ahead of annual dividend announcements.
The Saudi index far outperformed the rest of the region as it rose 1.4 percent to 7,440 points in active trade, rising above last September’s peak of 7,429 points.
Dozens of Saudi princes, officials and top businessmen - including owners of major stakes in some firms - were detained as part of the crackdown in early November. The market’s initial panic has faded, but investors are still concerned about the fate of some of the companies involved.
"
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The First Investor acquires another German asset - The Peninsula Qatar
The First Investor acquires another German asset - The Peninsula Qatar:
"The First Investor (TFI) Qatar, a subsidiary of Barwa Bank Group and the leading Qatari closed shareholding investment banking firm, lands on another acquisition of a prestigious new office building in one of the most vibrant business areas in Frankfurt. The asset is another unique blend to TFI Euro Income Fund (“The Fund”), which was launched in 2017 with sharia compliant stature. The diversity of the Euro Fund’s assets (Germany and France) will provide investors with sustainable high-yield and potential capital growth at maturity of the Fund. The new property is a stand-alone office building situated in Neu-isenburg in Frankfurt’s Main District, a freehold asset occupied by high-grade tenants on long lease basis. ‘Building on its strategic joint venture with INOVALIS REIT, a listed real estate fund, the First Investor is pleased to bring to bear an alliance based on focus and determination to maintain our prime position in Qatar as the leading Islamic investment company’, said Houssam Kharbotli TFI CEO."
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"The First Investor (TFI) Qatar, a subsidiary of Barwa Bank Group and the leading Qatari closed shareholding investment banking firm, lands on another acquisition of a prestigious new office building in one of the most vibrant business areas in Frankfurt. The asset is another unique blend to TFI Euro Income Fund (“The Fund”), which was launched in 2017 with sharia compliant stature. The diversity of the Euro Fund’s assets (Germany and France) will provide investors with sustainable high-yield and potential capital growth at maturity of the Fund. The new property is a stand-alone office building situated in Neu-isenburg in Frankfurt’s Main District, a freehold asset occupied by high-grade tenants on long lease basis. ‘Building on its strategic joint venture with INOVALIS REIT, a listed real estate fund, the First Investor is pleased to bring to bear an alliance based on focus and determination to maintain our prime position in Qatar as the leading Islamic investment company’, said Houssam Kharbotli TFI CEO."
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Realty Headwinds: Yields for Dubai's affordable homes set to decline | ZAWYA MENA Edition
Realty Headwinds: Yields for Dubai's affordable homes set to decline | ZAWYA MENA Edition:
"Residential yields in Dubai's affordable market are expected to decline much faster than in the prime market, say a report released by real estate consultancy Core Savills. Over 2014-2016, the prime segment saw a combination of weakening prices but comparatively stable rents, encouraging a share of tenants to shift towards ownership. This drove down rental demand and gradually caused prices to stabilise over 2017. This caused yield compression by an average of 57 base points, representing a relative decline of 11.2 per cent across prime and mid-market communities during 2017."
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"Residential yields in Dubai's affordable market are expected to decline much faster than in the prime market, say a report released by real estate consultancy Core Savills. Over 2014-2016, the prime segment saw a combination of weakening prices but comparatively stable rents, encouraging a share of tenants to shift towards ownership. This drove down rental demand and gradually caused prices to stabilise over 2017. This caused yield compression by an average of 57 base points, representing a relative decline of 11.2 per cent across prime and mid-market communities during 2017."
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Saudi's Kingdom Holding jumps on hope for Prince Alwaleed settlement | ZAWYA MENA Edition
Saudi's Kingdom Holding jumps on hope for Prince Alwaleed settlement | ZAWYA MENA Edition:
"Shares in Saudi Arabia's Kingdom Holding jump 7.6 percent to 9.36 riyals, highest level since Nov. 6, just after chairman and owner Prince Alwaleed bin Talal was detained in sweeping anti-corruption crackdown
Senior Saudi official tells Reuters that Prince Alwaleed is negotiating possible settlement with authorities but so far has not agreed on terms; "he offered a certain figure but it doesn’t meet the figure required from him, and until today the attorney-general hasn’t approved it"
Kingdom Holding has said it is continuing to operate normally during Prince Alwaleed's detention"
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"Shares in Saudi Arabia's Kingdom Holding jump 7.6 percent to 9.36 riyals, highest level since Nov. 6, just after chairman and owner Prince Alwaleed bin Talal was detained in sweeping anti-corruption crackdown
Senior Saudi official tells Reuters that Prince Alwaleed is negotiating possible settlement with authorities but so far has not agreed on terms; "he offered a certain figure but it doesn’t meet the figure required from him, and until today the attorney-general hasn’t approved it"
Kingdom Holding has said it is continuing to operate normally during Prince Alwaleed's detention"
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Saudi Prince Alwaleed in settlement talks with government: sources
Saudi Prince Alwaleed in settlement talks with government: sources:
"Saudi Arabia’s billionaire Prince Alwaleed bin Talal, detained for over two months in an anti-corruption crackdown, is negotiating a possible settlement with authorities but so far has not agreed on terms, a senior Saudi official said.
Prince Alwaleed, whose net worth has been estimated by Forbes magazine at $17 billion, is chairman and owner of international investment firm Kingdom Holding 4280.SE, and one of the country’s most prominent businessmen.
“He offered a certain figure but it doesn’t meet the figure required from him, and until today the attorney-general hasn’t approved it,” the official said on condition of anonymity under government briefing rules. "
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"Saudi Arabia’s billionaire Prince Alwaleed bin Talal, detained for over two months in an anti-corruption crackdown, is negotiating a possible settlement with authorities but so far has not agreed on terms, a senior Saudi official said.
Prince Alwaleed, whose net worth has been estimated by Forbes magazine at $17 billion, is chairman and owner of international investment firm Kingdom Holding 4280.SE, and one of the country’s most prominent businessmen.
“He offered a certain figure but it doesn’t meet the figure required from him, and until today the attorney-general hasn’t approved it,” the official said on condition of anonymity under government briefing rules. "
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Qatar dairy producer Baladna to IPO in first half, expand into new areas
Qatar dairy producer Baladna to IPO in first half, expand into new areas:
"Qatari company Baladna, which is creating a dairy industry in the desert to help the country withstand a boycott by other Arab states, plans an initial public offer of its shares in the next few months and aims to move into other farming sectors. “In partnership with a group of businessmen and local citizens, Baladna plans to launch its IPO in the first half of 2018,” the company, which flew 3,400 cows into Qatar during the initial weeks of the boycott to address a shortage of fresh milk, said on Sunday."
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"Qatari company Baladna, which is creating a dairy industry in the desert to help the country withstand a boycott by other Arab states, plans an initial public offer of its shares in the next few months and aims to move into other farming sectors. “In partnership with a group of businessmen and local citizens, Baladna plans to launch its IPO in the first half of 2018,” the company, which flew 3,400 cows into Qatar during the initial weeks of the boycott to address a shortage of fresh milk, said on Sunday."
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Dubai's the Very Model of a Modern Mideast Economy - Bloomberg
Dubai's the Very Model of a Modern Mideast Economy - Bloomberg:
"For more than 100 years, the Middle East has been defined by oil exploration, production and its boundaries. Now the region is getting repurposed by its aspiration to grow beyond fossil fuel. The shake-up in Saudi Arabia's royal family was as much about becoming a 21st-century economy as it was about rooting out corruption. None of the region's petrostates has moved further from its oilfield roots than Dubai, which has been diversifying its economy since the 1970s. The result is a thriving gateway to globalization with a superior economic outlook. The largest of the seven United Arab Emirates and home to more than 200 nationalities, Dubai is growing faster than its neighbors as the No. 3 regional tourist destination behind Turkey and Saudi Arabia. Situated within eight flying hours of two-thirds of the world's population, Dubai has the region's busiest international airport measured in total passengers and fourth-largest airline based on revenue per passenger kilometer. The city's 2,717-foot Burj Khalifa is the world's tallest building, rising above Jebel Ali, the ninth-largest port. The relentless commitment to infrastructure development turned Dubai into the Mideast hub for finance, information technology, real estate, shipping and even flowers. "
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"For more than 100 years, the Middle East has been defined by oil exploration, production and its boundaries. Now the region is getting repurposed by its aspiration to grow beyond fossil fuel. The shake-up in Saudi Arabia's royal family was as much about becoming a 21st-century economy as it was about rooting out corruption. None of the region's petrostates has moved further from its oilfield roots than Dubai, which has been diversifying its economy since the 1970s. The result is a thriving gateway to globalization with a superior economic outlook. The largest of the seven United Arab Emirates and home to more than 200 nationalities, Dubai is growing faster than its neighbors as the No. 3 regional tourist destination behind Turkey and Saudi Arabia. Situated within eight flying hours of two-thirds of the world's population, Dubai has the region's busiest international airport measured in total passengers and fourth-largest airline based on revenue per passenger kilometer. The city's 2,717-foot Burj Khalifa is the world's tallest building, rising above Jebel Ali, the ninth-largest port. The relentless commitment to infrastructure development turned Dubai into the Mideast hub for finance, information technology, real estate, shipping and even flowers. "
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Saudi Wealth Fund Is Said to Weigh Bank Loans for Investments - Bloomberg
Saudi Wealth Fund Is Said to Weigh Bank Loans for Investments - Bloomberg:
"Saudi Arabia’s sovereign wealth fund, which aims to become a $2 trillion investment giant, is considering borrowing from banks for the first time as it seeks investments in the kingdom and abroad, according to people familiar with the matter.
The Public Investment Fund, or PIF, has held talks with local and international banks and could raise about $5 billion this year, some of the people said, asking not to be identified because the information is private. No final decisions on timing or size have been made and the PIF may instead turn to government financing, the people said.
A spokesman for the PIF declined to comment."
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"Saudi Arabia’s sovereign wealth fund, which aims to become a $2 trillion investment giant, is considering borrowing from banks for the first time as it seeks investments in the kingdom and abroad, according to people familiar with the matter.
The Public Investment Fund, or PIF, has held talks with local and international banks and could raise about $5 billion this year, some of the people said, asking not to be identified because the information is private. No final decisions on timing or size have been made and the PIF may instead turn to government financing, the people said.
A spokesman for the PIF declined to comment."
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MIDEAST STOCKS-Banks help Saudi rise early on, Qatar continues rally
MIDEAST STOCKS-Banks help Saudi rise early on, Qatar continues rally:
"Banking shares helped Saudi Arabia’s stock market rise in early trade on Sunday, while Qatar headed for a seventh straight day of gains as investors bought ahead of annual dividend announcements. The Saudi index was 1.0 percent higher after an hour with all 12 listed banks climbing after Saudi Arabia’s central bank lifted the maximum loan-to-value ratio for mortgages taken out by first-time homebuyers to 90 percent from 85 percent in an effort to stimulate mortgage lending. National Commercial Bank, the biggest lender, added 1.8 percent and Al Jazira Bank surged 2.7 percent."
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"Banking shares helped Saudi Arabia’s stock market rise in early trade on Sunday, while Qatar headed for a seventh straight day of gains as investors bought ahead of annual dividend announcements. The Saudi index was 1.0 percent higher after an hour with all 12 listed banks climbing after Saudi Arabia’s central bank lifted the maximum loan-to-value ratio for mortgages taken out by first-time homebuyers to 90 percent from 85 percent in an effort to stimulate mortgage lending. National Commercial Bank, the biggest lender, added 1.8 percent and Al Jazira Bank surged 2.7 percent."
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